Packaging Corp of America (PKG)
Return on total capital
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 1,075,100 | 1,420,700 | 1,241,400 | 723,900 | 1,053,700 |
| Long-term debt | US$ in thousands | 2,472,200 | 2,473,600 | 2,471,500 | 2,479,400 | 2,476,800 |
| Total stockholders’ equity | US$ in thousands | 3,997,300 | 3,667,100 | 3,607,200 | 3,246,300 | 3,071,000 |
| Return on total capital | 16.62% | 23.14% | 20.42% | 12.64% | 18.99% |
December 31, 2023 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $1,075,100K ÷ ($2,472,200K + $3,997,300K)
= 16.62%
Packaging Corp Of America's return on total capital has shown variability over the past five years, ranging from 14.45% in 2020 to 24.08% in 2022. In 2023, the return on total capital was recorded at 16.25%. This metric indicates the efficiency with which the company is utilizing its total capital to generate profits. A higher return on total capital suggests effective capital allocation and operational performance, while a lower figure may indicate inefficiencies or lower profitability. It is important for stakeholders to monitor this ratio over time to assess the company's ability to generate returns relative to the capital invested.
Peer comparison
Dec 31, 2023